“Banking the Unbanked” is one of the use cases of Bitcoin as projected by the cryptocurrency community. The digital currency has been successful to an extent in that mission. The lack of access to mainstream banking is prevalent in many developing nations across the world, including the African continent. Bitpesa and other cryptocurrency-backed services have been offering financial services in these countries for a while now.
The increasing usage of Bitcoin and Bitcoin-based services for remittance as well as regular transactions has made governments in the region consider cryptocurrency regulations. While some African nations have decided to wait and watch how the scenario will develop in the near future, countries like Uganda and Kenya are taking a more proactive approach by considering official policies and regulations.
After the recent UNAFRI (United Nations African Institute for the Prevention of Crime and Treatment of Offenders) roundtable conference that focused on virtual currency in Uganda, the country may become the first African nation to implement regulations. The regulations, if implemented by Uganda anytime soon, will set a precedent for other countries in the continent to come up with similar laws.
Any cryptocurrency regulations introduced in this part of the world has to be done only after careful deliberations. The number of individuals and businesses are increasingly growing dependent on Bitcoin-based platforms and services. Anything that hampers such adoption may not only rob the countries of any chance for rapid economic improvement, but also make it difficult for startups and companies to operate in the region.
Recently, Bitpesa — one of the prominent players in the region announced a B2B service that allows business owners in Nigeria and few other countries to pay directly into the bank accounts of Chinese counterparts with whom they do business. The new service is expected to reduce the transaction costs for these businesses by a least 60 percent while reducing the time taken for the transfer. This is expected to further strengthen trade between China and African nations.